The prototype should show if it is possible to do what you want on the target platform.
If your demo uses tons of shaders, bones, terrain and multiplayer network AND your target platform is the AMIGA or a non DirecX platform like linux, the whole thing is worthles.
Well, you could show the gameplay but thats all.

You do the prototype not only for publishers - it is for YOU.
- Is feature X possible on that platform?
- How complicated is it to create this effect in our game?
- What are the model constraints (num vertices, num textures, ...)
- Can we use 3D Package [big name here] use to create the models
- What is the exact workflow to get the model out of our 3D Package into the game?
- What are the restrictions with this workflow (like: can not use bone animations because there is no exporter with that feature)

Now, your prototype is ready to show with GameStudio.
The publisher wants this to run on your target platform - say X-Box

You need to do the whole trick again, because you can not derive your experiences from engine A to engine B

-- slacer